2026 U.S. Tunnel Overview

The U.S. tunnel construction market had another eventful year, with many ongoing projects, high-profile contracts awarded, and notable milestones achieved. Looking ahead, 2026 promises its own share of activity and major highlights.

Major Ongoing Projects – New York
The most intense concentration of activity has been in the New York City metropolitan area, led by the Gateway Development Corporation’s $16 billion Hudson Tunnel Project. The overall project comprises nine miles of new passenger rail between New York and New Jersey, including nearly five miles of tunnel boring to construct a new, two-tube tunnel under the Hudson River. Following completion of the new tunnels, the existing North River Tunnel will be rehabilitated. With both tunnels in service, currently slated for 2038, capacity and resiliency along the Northeast Corridor—the busiest passenger rail segment in the country—will be significantly improved.

The Hudson Tunnel Project consists of four underground segments: the Palisades Tunnel, Hudson River Tunnel, Manhattan Tunnel, and Hudson Yards Concrete Casing. Another key construction contract is the Hudson River Ground Stabilization Phase 2 project, which involves injecting a mix of soil, concrete, and water into 1,200 ft of the shallow riverbed on the Manhattan side of the Hudson River to ensure that Tunnel Boring Machines (TBMs) can safely excavate the new tunnel and protect the riverbed from disruption.

Below is a recap of the main underground work.

Hudson River Tunnel: GDC issued an RFQ for the Hudson River Tunnel Project in late 2024, with the goal of selecting a contractor to begin work in 2026. The Hudson River Tunnel comprises approximately 7,250 ft of 25-ft, 2-in. ID twin-tube tunnel from the Hudson County Shaft in New Jersey to the 12th Avenue Shaft in Manhattan. GDC was expected to award the contract in early 2026.

Manhattan Tunnel: A vital link between the new bored tunnel and Penn Station is the Manhattan Tunnel. In February 2025, GDC awarded a $1.18 billion contract to the Frontier-Kemper–Tutor-Perini JV and authorized NTP. The Manhattan Tunnel Project includes the design and construction of approximately 700 ft of twin 30-ft-diameter tunnels. Construction of this segment is expected to continue through 2029.

Palisades Tunnel: In August 2024, GDC awarded the Palisades Tunnel contract to the Schiavone-Dragados-Lane JV for $465 million, marking the first tunnel boring contract for the overall Hudson Tunnel Project. The Palisades Tunnel Project will construct the first mile of twin tunnels on the New Jersey side of the Hudson River. Work includes boring two tunnels approximately 5,100 ft long with a 25-ft, 2-in. inside diameter, constructing six cross passages, and furnishing and installing a concrete tunnel lining with waterproofing membrane. The project also includes construction of the new Hudson County Shaft, which will be used to retrieve the TBMs once tunneling is complete. The TBMs were built at Herrenknecht’s factory in Schwanau, Germany, with the first machine on site and the second expected to be shipped in early 2026.

Hudson Yards Concrete Casing – Section 3 (HYCC-3): HYCC-3 is an essential right-of-way preservation project on Manhattan’s West Side, enabling the new Hudson River Tunnel to connect to New York Penn Station. The project extends the existing concrete casing on a diagonal alignment from 11th Avenue to 30th Street, where it will link with the new tunnel. HYCC-3 will be approximately 500 ft long, 60 ft wide, and 60 ft high. Construction began in November 2023 and was expected to conclude in 2026.

In late January, however, GDC announced that HYCC-3 was at risk of a construction pause if federal fund disbursements did not resume. GDC notified the contractors working on the Hudson Tunnel Project that funding for construction would run out on Feb. 6. At the time of writing, contractors were winding down work at active sites in New York, New Jersey, and the Hudson River, with construction to stop until additional funding becomes available.

In September, GDC was notified by the Federal Transit Administration that federal disbursements under the Capital Investment Grants (CIG) Program would be paused pending a review of the Commission’s federally mandated Disadvantaged Business Enterprise (DBE) program. The following day, all federal funding for the Hudson Tunnel Project—not just CIG funds—was paused.

Elsewhere in New York, the Metropolitan Transportation Authority (MTA) Board announced in August 2025 that it had approved the tunnel boring contract for Phase 2 of the Second Avenue Subway, another project decades in the making. The $1.972 billion contract was awarded to Connect Plus Partners, a joint venture between Halmar International and FCC Construction. Phase 2 will extend train service from 96th Street north to 125th Street and then west along 125th Street to Park Avenue, a total of approximately 1.5 miles. Heavy civil construction was expected to begin this year, with tunnel boring scheduled to start in 2027. Phase 1, which extends from 63rd Street to 96th Street, opened on Jan. 1, 2017.

Finally, in New York, the Department of Environmental Protection awarded a $1.1 billion contract for the Kensico–Eastview Connection Tunnel Project to Frontier-Kemper Constructors. The project entails construction of a new deep-rock tunnel between the Kensico Reservoir and the Catskill/Delaware Ultraviolet (CDUV) Light Disinfection Facility to provide an additional means of conveying water between the Kensico Reservoir and the CDUV facility, enhancing operational resiliency and redundancy for New York City’s water supply system. The new tunnel will run approximately 500 ft below ground and extend roughly two miles. The finished tunnel will be 27 ft in diameter. The project also includes two large shafts to accommodate TBM launch and retrieval. NTP was issued in early 2025, and substantial completion is expected in 2030.

Major Ongoing Projects – Nationwide
Outside the New York area, several high-value projects are underway, notably the Valley Transportation Authority’s BART Silicon Valley Phase II project in San Jose, California. Estimated at about $12 billion, the extension will connect Santa Clara Station to Berryessa/North San Jose Station, completing a continuous rail loop around the San Francisco Bay.

The project is a 6-mile extension (5 miles underground) with four stations (three underground) running through downtown San Jose. It is notable for its plan to use an approximately 54-ft-diameter TBM to bore a single tunnel that will house bi-directional traffic and inline underground stations. This single-bore approach will be the first of its kind in the United States, and the TBM will be the second largest used in the country to date (behind the 57.5-ft Seattle SR 99 TBM). The TBM completed factory testing at the Herrenknecht facility in Germany over the summer. VTA entered into a progressive design-build contract with the Kiewit Shea Traylor JV in 2022 and is currently evaluating contract packaging and delivery approaches for Phase II.

Another multi-billion-dollar tunnel initiative underway is the B&P Tunnel Replacement Program in Baltimore, Maryland. Its signature component is the new twin-tube, 2-mile Frederick Douglass Tunnel. In 2024, Amtrak awarded a CMAR contract to the Kiewit/J.F. Shea JV for construction package A, which includes tunnel construction. The delivery partner is ADVANCE JV (AECOM/S Jacobs), and WSP/Parsons JV serves as the engineer of record. The program replaces a low-speed, two-track brick arch tunnel built in the 1870s with two new high-speed tunnel bores, removing a key bottleneck on the Northeast Corridor and improving connectivity in the Baltimore–Washington region.

By the Numbers
According to information gathered by TBM, there are approximately 20 projects with values greater than $100 million currently in construction with significant work remaining. A handful of additional projects are in final stages and expected to be closed out in the coming months. In total, these projects represent roughly $31 billion in construction value, although in some cases the totals reflect full program values that include more than tunneling and underground works.

2025 Highlights
One of the most notable stories of the past year was the completion of tunneling on two major highway projects in the Norfolk, Virginia, area. Both involve boring beneath shipping channels from one artificial island to another. These represent only the third and fourth highway projects in the United States to be delivered via TBM-bored tunnels; the others are Seattle SR 99 and the Port of Miami Tunnel.

On Jan. 27, 2025, the $755 million Parallel Thimble Shoal Tunnel Project at the Chesapeake Bay Bridge-Tunnel broke through into the reception pit at Two Island. Mining for this two-lane, approximately one-mile-long tunnel began in February 2023 and encountered a number of challenges. In May 2023, the 42-ft-diameter Herrenknecht EPB struck a more-than-100-year-old anchor buried in the seafloor, causing a delay of about a year. As the TBM approached the finish line, crews encountered additional metal debris, possibly remnants from construction of the artificial island. With boring now complete, the contractor, Dragados/Schiavone, can focus on roadway construction and systems installation. Overall project completion is anticipated by early 2028.

The Hampton Roads Bridge-Tunnel (HRBT) Expansion project reached a major milestone on Sept. 24, 2025, with breakthrough of the southbound tube of the twin-tube highway tunnel. This marks the end of major excavation for the $3.9 billion project. The HRBT Expansion is the largest highway construction project in Virginia’s history. It aims to ease congestion along a nearly 10-mile corridor of I-64 by adding twin, two-lane bored tunnels beneath the harbor. In addition to the new tunnels, the project includes replacing or rebuilding bridge structures (five bridges will be replaced and 23 widened), replacing marine trestles, and widening the roadway in each direction.

The HRBT tunnels were built using a variable-density Herrenknecht slurry TBM. The machine arrived on site in 2021 and launched in April 2023. It completed the nearly 8,000-ft first drive in April 2024, was rotated on a turntable, and then re-launched to complete the second drive. Final project completion is expected in 2027. The contractor is Hampton Roads Connector Partners, a joint venture including Dragados USA, Vinci Construction Grands Projets, Flatiron Constructors, and Dodin Campenon Bernard.
On the wastewater side, Citizens Energy Group and its partners celebrated completion of the DigIndy project on Oct. 9, an underground tunnel system in Indianapolis, Indiana. DigIndy, comprising 28 miles of tunnels, was completed after a 14-year construction program and will further reduce sewage overflow events in central Indiana.

The DigIndy program included:

• Deep Rock Tunnel Connector: 39,362 lf of tunnel; 3 CSO connecting structures/deaeration chambers and adits.
• Eagle Creek Tunnel: 9,175 lf of tunnel (added as a change order to the Deep Rock Tunnel Connector); one CSO connecting structure/plunge drop.
• White River Tunnel: 30,628 lf of tunnel; 2 bifurcations; 7 CSO connecting structures/deaeration chambers and adits.
• Lower Pogues Run Tunnel: 10,182 ft of tunnel, bifurcating from the White River Tunnel; 2 CSO connecting structures/deaeration chambers and adits.
• Fall Creek Tunnel: 20,244 lf of tunnel; 10 CSO connecting structures/deaeration chambers and adits.
• Pleasant Run Tunnel: 41,472 lf of tunnel; 8 CSO connecting structures/deaeration chambers and adits.

All tunnels were built using the same 20-ft, 2-in. OD refurbished Robbins hard-rock TBM, originally manufactured in 1980 and reconfigured for Indianapolis geology. The tunnels are lined using Everest forms with a 1-ft-thick cast-in-place concrete lining, resulting in a finished diameter of 18 ft. Shea-Kiewit served as the contractor for the entire program.

Upcoming Projects
While there is a robust slate of work currently under construction across the United States, future demand also appears strong. On the wastewater side, the Allegheny County Sanitary Authority (ALCOSAN) near Pittsburgh, Pennsylvania, is preparing to launch its multi-billion-dollar CSO improvement program as part of a consent decree with EPA. The program is expected to include tunnel segments to convey and store overflows for treatment, with improvements slated for completion by the end of 2036. The system comprises three large tunnels, to be delivered via design-bid-build: the Ohio River Tunnel (~4.9 miles), the Allegheny River Tunnel (~6.2 miles), and the Monongahela River Tunnel (~5.4 miles). Additional elements include consolidation sewers, a dewatering pump station, and treatment plant upgrades. Bids for the Ohio River Tunnel were due in January 2026. The overall construction value for the program is estimated at approximately $3.5 billion.

In Missouri, the Metropolitan St. Louis Sewer District’s Project Clear CSO program is well underway, but two large tunnel projects remain. The Lower & Middle River Des Peres (LMRDP) CSO Storage Tunnel is a 9-mile-long, 30-ft-diameter tunnel with three large construction shafts, gearing up for a construction start in 2028. The estimated construction cost is $1 billion. Also in the planning and design phase is the Upper River Des Peres and River Des Peres Tributaries (Tribs) Storage Tunnel, which includes a 6-mile-long main tunnel, 18 ft in diameter, with 12,200 ft of 12-ft-diameter connection tunnels and seven large shafts. The estimated cost is $700 million, with construction currently anticipated to start in 2030.

On the drinking water side, the Massachusetts Water Resources Authority (MWRA) Metropolitan Water Tunnel Program is in design. The program is intended to provide redundancy for a critical drinking water system that has already been impacted by a 2010 water main break and a 2024 tunnel incident. It includes two main tunnel segments: the North Tunnel (~5 miles long, 10–12 ft in diameter, 200–375 ft deep, 5 shafts) and the South Tunnel (~10 miles long, 10–12 ft in diameter, 250–520 ft deep, 8 shafts). Construction is expected to take 8 to 12 years, with an estimated cost of $1.7 billion.

Many other projects involving significant tunneling are in various stages of development, including:

• Delta Conveyance Project, California (Water)
• Last Chance Grade, California (Highway)
• Eastside Transit Corridor Phase 2, California (Transit)
• Sepulveda Corridor, California (Transit)
• ONTConnector, California (Transit)
• Downtown Rail Extension (The Portal), California (Transit)
• SANDAG Del Mar Tunnel, California (Transit)
• High-Speed Rail, California (Transit)
• Flushing Bay CSO, New York (Sewer/CSO)
• Newtown Creek CSO, New York (Sewer/CSO)
• Big Creek Storage Tunnel, Ohio (Sewer/CSO)
• Houston Flood Control Tunnels, Texas (Flood Control)
• West Seattle Link Extension, Washington (Transit)
• Ballard Link Extension, Washington (Transit)

These and other emerging projects are still being defined, making precise cost estimates challenging. A rough estimate, however, places their cumulative value well over $100 billion, with the important caveat that not all will advance to construction. A more conservative estimate of projects that are more likely to move forward still exceeds $50 billion.

Conclusion
The U.S. tunneling market remains strong, supported by a mix of major ongoing programs and a deep pipeline of planned work. Demand for tunnels serving upgraded sewer and water systems and improved transportation networks is being driven by aging infrastructure, population growth, and a broad public desire for enhanced quality of life. At the same time, the growing impacts of climate change are creating new opportunities for projects aimed at improving the resiliency and reliability of urban infrastructure.